3) Maxinne ltd is considering whether to build an oil or a coal generating plant. Its weighted average cost of capital is 8% for low-risk projects, 10% for average risk projects and 12% for high risk projects. The management believes that an oil plant is of average risk but a coal plant is of high risk. The cashflows required to construct each plant are listed below. The revenue, fuel costs and other operating costs are expected to be the same under both plans. Construction costs ( sh 000) year Coal plant Oil plant 0 100 400 1 500 1000 2 1500 1000 3 1500 1000 4 1500 1500 5 1000 1000 6 500 200 Required: which plant should be constructed? Show your working